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HANGZHOU, China: May 29, 2018. Alibaba and its logistic arm Cainiao Network are the lead investors acquiring a 10 percent stake in Chinese delivery company ZTO Express for US$1.38 billion.

The investment is expected to further support both Cainiao and ZTO's efforts in building first and last-mile pickup and delivery capabilities, warehouse management, cross-border logistics and technology-driven smart solutions.

ZTO Express"ZTO has been an important partner to Alibaba Group and Cainiao Network in the development of the new digital economy,” said Alibaba Group CEO and Cainiao Network chairman Daniel Zhang.

“The continuing expansion of ‘New Retail’ is catalyzing new opportunities and demands in logistics. This strategic investment will strengthen synergies across our mutual businesses to create new value and improved experience for merchants and consumers."

Alibaba’s New Retail concept is designed to link online and offline commerce using AI and data analytics to understand consumer behavior.

The company said it would require investment in smart supply chains, retail technologies, advanced logistics and mobile payments.

"The growth of e-commerce and New Retail in China demands more efficient express delivery and expanded logistics services,” commented ZTO founder and CEO Meisong Lai. “This partnership will enable us to expand our selection of high quality service offerings both in China and internationally, and is fully aligned with our common interest in improving logistics efficiency and enhancing customer experience."

ZTO reported a 35.6 percent year-on-year rise in Q1 revenue to US$565.1 million; a 41.3 percent increase in gross profit to US$164.5 million; and net income of US$88.9 million – up 10.9 percent from the same period last year.

Cainiao provides same-day and next-day delivery in nearly 1,500 districts and counties in China and now operates Cainiao Post, a network of last-mile stations covering communities in 100 cities and around 1,800 university campuses.

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